Author Topic: Fixed Term BitUSD Savings Club  (Read 4427 times)

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Offline abit

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I wouldn't compare this to a time deposit because this has a real risk of losing the whole investment. This is more like a milder form of gambling, which is why I understand if somebody doesn't want to take part. But as long as the risk is made clear for the users, I don't see any problems or reasons to feel guilty. Nobody forces to use this.

Is there anybody who could and want make this? If Cryptonomex is too busy, could this be a job for @kenCode and his freelancers? Of course I'm not a coder so I can't really know how difficult this is in reality, but it would seem like a nice little project for somebody willing to learn to code for Bitshares.

Fair enough, I think it has some elements in common with a time deposit but you are right that because of the high risk it's more like a milder form of gambling.

I'm not sure what the best parameters are and how much support there is for it but it seemed fairly simple to code/implement so hopefully someone with more skills in this area will jump on the opprtunity to create a quick turnaround, income producing feature that would also increase Smartcoin usage and CAP.
Sure it's able to implement, but it may not be so simple like you thought. Imo it will not be easier than to implement a bond market since it's a new business in the block chain (for bond market we can reuse the market engine and collateral code/modules).
To make it possible to have many "clubs" in the system, with features including but not limited to create club, define parameters, search/list clubs, deposit, withdraw, check status, "member alive check", profit delivery, we need several new operation types and data types, and more memory/disk spaces to store related data, more CPU power to calculate at every maintenance interval.
If you have fund to invest you can have a try.
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Offline Empirical1.2

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I wouldn't compare this to a time deposit because this has a real risk of losing the whole investment. This is more like a milder form of gambling, which is why I understand if somebody doesn't want to take part. But as long as the risk is made clear for the users, I don't see any problems or reasons to feel guilty. Nobody forces to use this.

Is there anybody who could and want make this? If Cryptonomex is too busy, could this be a job for @kenCode and his freelancers? Of course I'm not a coder so I can't really know how difficult this is in reality, but it would seem like a nice little project for somebody willing to learn to code for Bitshares.

Fair enough, I think it has some elements in common with a time deposit but you are right that because of the high risk it's more like a milder form of gambling.

I'm not sure what the best parameters are and how much support there is for it but it seemed fairly simple to code/implement so hopefully someone with more skills in this area will jump on the opprtunity to create a quick turnaround, income producing feature that would also increase Smartcoin usage and CAP.
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Offline Samupaha

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I wouldn't compare this to a time deposit because this has a real risk of losing the whole investment. This is more like a milder form of gambling, which is why I understand if somebody doesn't want to take part. But as long as the risk is made clear for the users, I don't see any problems or reasons to feel guilty. Nobody forces to use this.

Is there anybody who could and want make this? If Cryptonomex is too busy, could this be a job for @kenCode and his freelancers? Of course I'm not a coder so I can't really know how difficult this is in reality, but it would seem like a nice little project for somebody willing to learn to code for Bitshares.

Offline Empirical1.2

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This is some kind of reverse-insurance. When you buy an insurance, you pay a little, and get more than you paid when you lost some, but loss little when you lost none. When you buy this, you pay much, and gain a little when others lost some, and gain nothing when nobody losses, but no help when you loss much . It makes me feel guilty and unsafe. Maybe some aggressive investors have interest in this.

By the way, if it's for saving bit USD but not bts, it may reduce liquidity of bit USD market.

You don't like Fixed Term deposit with higher rewards? Nearly every bank offers this option.

https://en.m.wikipedia.org/wiki/Time_deposit

While it would better with a bond market or the old style BitAssets that paid interest, so the balance could be invested, this model like banks will get part of the yield from charging high fees to people who need access to their funds during that time.

In crypto because it's not possible to unlock an account you don't have private keys/other for via loss or death. This model allows those funds, which would otherwise be wasted, to create yield for others. (In this system you also take a risk that you forget to 'proof of life' your account at the end of term.)

Blockchain insurance models require a lot of ongoing validation and possibly risk profiling work, it's a massive undertaking imo, while this could be a fairly simple to code smart contract.

I think people who may be planning to hold something like BitGold for a longer period anyway would find this appealing. I think you are right that it could reduce liquidity but it would also increase demand & CAP of Smartcoins which would be great for BTS.
« Last Edit: January 02, 2016, 12:10:24 pm by Empirical1.2 »
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Offline abit

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This is some kind of reverse-insurance. When you buy an insurance, you pay a little, and get more than you paid when you lost some, but loss little when you lost none. When you buy this, you pay much, and gain a little when others lost some, and gain nothing when nobody losses, but no help when you loss much . It makes me feel guilty and unsafe. Maybe some aggressive investors have interest in this.

By the way, if it's for saving bit USD but not bts, it may reduce liquidity of bit USD market.
« Last Edit: January 02, 2016, 09:36:21 am by abit »
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Offline Samupaha

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So how we'll get things going with this?

Now that I've thought this little bit more, I think there is no need to limit this only to be used with MPAs – this should be available for all assets. Anybody should be able to start a savings club with any asset they want.

FBA probably goes very well with this. It will create incentive for FBA owners to market this feature and bring lots of users for Bitshares. FBA owners recieve a percentage of the profits that a club makes. If every club member does "proof of life" and doesn't claim early, there are no profits, so in this case FBA owners don't get anything.

How fast it's possible to build a simple "proof of concept" smart contract on the blockchain? No need for anything fancy, starting a club doesn't need GUI, but investing in a club should be easy. But probably nothing more complicated than "send money to this address and you're in"? Of course we need some kind of tools for early claims and proofs of life.

In the first version is enough if there is only one kind of club. Something like: starts on the first day of month (so that every month new clubs can be created), lasts one year, 20 % fee in case of early claim, one month reserved for proof of life.

If this becomes successful and people are interested in it, we can add possibility to adjust starting day and length of the contract, percentages for early claim, etc.

This is exactly the kind of project that I want to see this year. Simple smart contract, shouldn't be too difficult to build, doesn't need any excessive infrastructure around it, concept is easy to grasp, creates profits for Bitshares by increasing transfers and helps BTS price to go up by locking funds for a long time.

Offline donkeypong

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Intriguing. I'm not sold yet, but I love the concept and will continue to think about it.

When BitShares traded away the inactivity fee and went with inflation, that was a fork in the road. It would be interesting to know where we would be today if we'd become the world's best crypto. Instead, we've tried to do much more with the blockchain, and hopefully that will be worth the sacrifice.
« Last Edit: December 15, 2015, 08:16:25 pm by donkeypong »

Offline Empirical1.2

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What you are describing was a feature of the original BTSX whitepaper. (5% annual inactivity fee).
With the presence of dilution any further fees for standard accounts would likely be untenable.

A possible option is to completely remove dilution and commit to being a no inflation crypto-currency again with the expectation that basic development can be paid for via fees, and blockchain additions & marketing can be funded via FBA's & the referral programme. In which case the inactivity fee could be re-introduced (& possibly make more BTS/valuable BTS available than is currently accessed via dilution.)

However as I said at the time, adding dilution was a Pandora's box, once precedent is set, it's hard to undo, so there's no guarantee BTS would regain crypto-currency status and value as well as being a kick ass DAC by relinquishing the flexibility dilution provides.

So was the inactivity fee implemented in BTSX or was it just in white paper? Something like 5% annual, 100 BTS minimum sounds reasonable. Let asset creators decide the amount for each asset.

Proposed but never implemented.

I did run a poll for implementing the inactivity fee at least for stake that was never claimed as an alternative to implementing dilution and there was some support for that.

https://bitsharestalk.org/index.php/topic,9950.0.html
« Last Edit: December 15, 2015, 06:59:59 pm by Empirical1.2 »
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Offline yvv

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What you are describing was a feature of the original BTSX whitepaper. (5% annual inactivity fee).
With the presence of dilution any further fees for standard accounts would likely be untenable.

A possible option is to completely remove dilution and commit to being a no inflation crypto-currency again with the expectation that basic development can be paid for via fees, and blockchain additions & marketing can be funded via FBA's & the referral programme. In which case the inactivity fee could be re-introduced (& possibly make more BTS/valuable BTS available than is currently accessed via dilution.)

However as I said at the time, adding dilution was a Pandora's box, once precedent is set, it's hard to undo, so there's no guarantee BTS would regain crypto-currency status and value as well as being a kick ass DAC by relinquishing the flexibility dilution provides.

So was the inactivity fee implemented in BTSX or was it just in white paper? Something like 5% annual, 100 BTS minimum sounds reasonable. Let asset creators decide the amount for each asset.

Offline Empirical1.2

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I like the idea, but we should have one for gold too. Personally, I view the USD as toxic and don't want to hold it at all, let alone for a year.

M

 +5% Yeah, I'd like a Gold one too.


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Offline mike623317

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I like the idea, but we should have one for gold too. Personally, I view the USD as toxic and don't want to hold it at all, let alone for a year.

M

Offline Empirical1.2

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I am not impressed by this particular proposal, but having a way to return money from orphan accounts would be actually good thing for the network. This could be done by setting inactivity fee or demurrage. Accounts which did not submit any transactions for, say, one year would pay a small fee. BTS fee would go to reserve pool, asset fees would be returned to asset issuers. If account is abandoned, it would continue to pay for inactivity until its balance goes to 0.

What you are describing was a feature of the original BTSX whitepaper. (5% annual inactivity fee).
With the presence of dilution any further fees for standard accounts would likely be untenable.

A possible option is to completely remove dilution and commit to being a no inflation crypto-currency again with the expectation that basic development can be paid for via fees, and blockchain additions & marketing can be funded via FBA's & the referral programme. In which case the inactivity fee could be re-introduced (& possibly make more BTS/valuable BTS available than is currently accessed via dilution.)

However as I said at the time, adding dilution was a Pandora's box, once precedent is set, it's hard to undo, so there's no guarantee BTS would regain crypto-currency status and value as well as being a kick ass DAC by relinquishing the flexibility dilution provides.

« Last Edit: December 15, 2015, 06:21:41 pm by Empirical1.2 »
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Offline yvv

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I am not impressed by this particular proposal, but having a way to return money from orphan accounts would be actually good thing for the network. This could be done by setting inactivity fee or demurrage. Accounts which did not submit any transactions for, say, one year would pay a small fee. BTS fee would go to reserve pool, asset fees would be returned to asset issuers. If account is abandoned, it would continue to pay for inactivity until its balance goes to 0.

Offline fuzzy

A one year time locked BitUSD savings club

This is a club where you are essentially gambling that you will not need access to your funds for an entire year and won't die/be detained/forget or lose your private keys and that enough others will, so that it generates meaningful interest.

- You can claim early but then you pay a 20% penalty fee.
-  In the final month you must perform a 'proof of life' account action or your deposit and interest will be forfeited.

 People who are forced to access their funds early, People who die/are detained/forget/lose private keys will pay penalty fees which will fund the returns for others.

Eg. if 10% claim early and 10% don't perform a 'proof of life' action during the claim month, that will generate 15% Per Annum.

Obviously the numbers can be tweaked and I have no idea how many will claim early/not claim.

It seems this could all be coded in a smart contract.

Once the bond market is in place the fund can be directed towards that and earn additional rewards.

This will take BTS off the market and increase the CAP of BitUSD.

Thoughts?

Hm.....

Damn empirical this is an interesting idea. 
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Offline Samupaha

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It seems harsh to pay a penalty if you forget/lose your private key/are detained/die but people would be entering into this voluntarily.
In the case of death or losing your private keys, your funds would most likely be lost anyway.

(Ideally this would all be coded, so no-one has access to the funds, it would all be handled by blockchain code.)

I wouldn't call it "harsh penalty". It is the risk here and it is clearly defined. It is the gambling part of the fund.

Of course this should be a full smart contract so that there is no need to any human interaction. It propably needs a hardfork or do we have tools already to make this happen? If this needs a hardfork, we could also do a fee backed asset! A part of the revenue would go to the FBA owners.

Offline Empirical1.2

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Eg. if 10% claim early and 10% don't perform a 'proof of life' action during the claim month, that will generate 15% Per Annum.


Murder is motivated..  ???

 :D

1. In a large pool of funds, the impact any one individual has is likely to be small.
2. If one person was known to hold a large amount of crypto, they're more susceptible to blackmail/kidnapping.
3. BTS will have STEALTH

Imagine a $10 million fund and you knew someone had $250 000 in it.
If you murdered him that would only generate $250 for every $10 000 you personally held in the fund.


Great idea, I'm in! Not exactly gambling but enough gambling-like so that people seeking risk and profits might really use this.

This could be done so that every month starts a new "batch" where people can put their money. This should be done also with BitCNY and BitEUR.

 +5%, I would also consider BitGold too.

So where is the interest for this coming from?

1. Traditional fixed term deposits usually have high penalty fees for early withdrawals.
A percentage of savers will due to unforeseen reasons or better investment opportunities need to remove their funds early, the penalty fees they incur for this are given to the savers who keep their funds in till maturity. So this will generate some interest/rewards.

2. There is also as mentioned the suggesting of doing some 'proof of life' at maturity. People who fail to do this will either forfeit/pay a penalty and these will be distributed to everyone else. Again generating interest/rewards.

3. If the bond market is in place. The fund could perhaps also be put on the market and generate some interest/rewards there.

It seems harsh to pay a penalty if you forget/lose your private key/are detained/die but people would be entering into this voluntarily.
In the case of death or losing your private keys, your funds would most likely be lost anyway.

(Ideally this would all be coded, so no-one has access to the funds, it would all be handled by blockchain code.)

« Last Edit: December 15, 2015, 03:51:16 pm by Empirical1.2 »
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Offline Thom


Eg. if 10% claim early and 10% don't perform a 'proof of life' action during the claim month, that will generate 15% Per Annum.


Murder is motivated..  ???

In contrast, it motivates STEALTH to circumvent the murder motive!
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Offline BunkerChainLabs-DataSecurityNode

So where is the interest for this coming from?
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Offline puppies

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Eg. if 10% claim early and 10% don't perform a 'proof of life' action during the claim month, that will generate 15% Per Annum.


Murder is motivated..  ???

Lol.  As is reporting others to the authorities, or infecting them with viruses so they lose their private keys.
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Offline abit

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Eg. if 10% claim early and 10% don't perform a 'proof of life' action during the claim month, that will generate 15% Per Annum.


Murder is motivated..  ???
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Offline Samupaha

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Great idea, I'm in! Not exactly gambling but enough gambling-like so that people seeking risk and profits might really use this.

This could be done so that every month starts a new "batch" where people can put their money. This should be done also with BitCNY and BitEUR.

Offline Empirical1.2

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A one year time locked BitUSD savings club

This is a club where you are essentially gambling that you will not need access to your funds for an entire year and won't die/be detained/forget or lose your private keys and that enough others will, so that it generates meaningful interest.

- You can claim early but then you pay a 20% penalty fee.
-  In the final month you must perform a 'proof of life' account action or your deposit and interest will be forfeited.

 People who are forced to access their funds early, People who die/are detained/forget/lose private keys will pay penalty fees which will fund the returns for others.

Eg. if 10% claim early and 10% don't perform a 'proof of life' action during the claim month, that will generate 15% Per Annum.

Obviously the numbers can be tweaked and I have no idea how many will claim early/not claim.

It seems this could all be coded in a smart contract.

Once the bond market is in place the fund can be directed towards that and earn additional rewards.

This will take BTS off the market and increase the CAP of BitUSD.

Thoughts?

If you want to take the island burn the boats